The funder tests eligibility. The Ghana Revenue Authority tests whether you met local statutory obligations while spending the money. Organisations manage the first well and discover the second during an audit.
Withholding tax applies to grant spending
This is the single most common finding we raise in the sector. An organisation being tax-exempt at entity level does not remove the obligation to deduct withholding tax on payments to suppliers, contractors and consultants. The liability sits with the organisation, not with the donor, and it is not an eligible cost, so it comes out of unrestricted funds.
Cost allocation is the other one
Where several grants run concurrently, shared costs have to be allocated on a documented and consistently applied basis. Rent, vehicles, senior staff time and finance function costs are the usual culprits. An allocation reconstructed during fieldwork is an allocation a funder can challenge, and disallowed costs are repayable.
Three engagement types, used interchangeably by funders
A grant audit gives an opinion on a statement of expenditure. An agreed-upon procedures engagement performs specified tests and reports factual findings without an opinion. An expenditure verification is AUP under the European Commission's own terms of reference. Funders use these terms loosely, so we read the grant agreement rather than the covering email, because the wrong engagement type produces a report that cannot be accepted.
Timing is not negotiable
Grant audit deadlines are usually tied to tranche release or programme closure. A late report suspends disbursement, which affects staff who need paying and beneficiaries expecting a service. We plan backwards from the funder's date and say at the outset if it is not achievable.
Applies to grant-funded payments regardless of your exempt status
Documented, or the cost is disallowed and repayable
Set by the funder, not by the auditor
Findings
What we find in donor-funded programmes
None of these are dishonest. They are what happens when a small finance team runs several grants at once without a written cost allocation policy.
- Withholding tax not deducted on payments to local suppliers and consultants
- Shared costs allocated without a written and consistently applied basis
- Costs charged to the wrong grant, or to two grants
- Procurement below the funder's threshold rules, with no documented waiver
- Staff time charged without timesheets to support the allocation
- Exchange rate applied at the wrong date on foreign currency grants
- Assets purchased with grant funds absent from any register
- Costs incurred outside the implementation period and therefore ineligible
Services
What NGO clients use us for
Most organisations need grant assurance and an institutional audit, and frequently a controls review before a large grant starts.
NGO and donor-funded audit
Grant audits, expenditure verification and AUP in the funder's own template.
Explore →Statutory audit
The institutional audit covering all funds, which your board and registration require annually.
Explore →Payroll and employment taxes
PAYE and SSNIT on programme staff, and the treatment of expatriate and short-term contractors.
Explore →Internal controls review
Cost allocation, procurement thresholds and pre-award readiness before a large grant.
Explore →Questions
Questions from finance and programme teams
Does withholding tax apply if our organisation is tax exempt?
What is the difference between a grant audit and an expenditure verification?
Can you audit several grants at once?
What makes a cost ineligible?
Next step
Send us the grant agreement and the funder's deadline.
With those two documents we can give you scope, timing and a fixed fee within one working day, and tell you honestly whether the deadline is achievable.